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Nike Two Challenge PESTLE ANALYSIS - Coggle Diagram
Nike Two Challenge PESTLE ANALYSIS
Innovation
Political Factors
Nike’s sales have grew 22% year-on-year in China, past five years
Nike’s digital business grew over 70% in China in the first quarter
No tariff fears for Nike after online success
Economic Factors
Affected by the Asian economic crisis since its products are made in some parts of Southeast Asia (Indonesia, Taiwan, Vietnam, Japan, Korea, Pakistan, and Thailand), where labor costs and material prices are rising.
Transportation costs of materials and goods
Nike has over 1 million workers in over
40 countries to produce all its products, with 29% of product made in China and 44% in Vietnam
The Trump Administration’s “America First” and the protectionist policies globally represent is a threat to Nike because their company is global
11% tariff on shoes imported into the US
Threat of an increase of 45% for goods coming from China
Nike is in partnership with Flex, a high tech manufacturing company to find a more effect source of labor
Technology Factors
Nike has combined with Apple to merge sports and music
Nike uses a marketing information system to the economic sciences of innovation and distinction.
Nike is no longer an athletic shoe manufacturer, it’s a tech company, having technology in a lot of there shoes such as flyknit, flywire, lunar light, etc.
Social Factors
Nike partners with top athletes all over the world
"Sneaker head" culture has grown since the 70s-80s with Nike leading the way
The sneaker resale market is estimated to reach $2billion, with Nike being one of the top brands often resold into distribution
Enviromental factors
The rising of minimum wage is a threat to Nike
More demanding laws in today's society involving workers rights and and working with other companies
Nike uses eco-friendly materials, such as organic and recycled cotton and polyester, and has water reduction initiatives in its supply chain
Legal Factors
Nike factories cause pollution
Not only pollution, but poisoning Chinese rivers and lakes
Nike has implemented measures to ease pollution and poisoning it has caused to the environment
Remote Working
Political Factors
from a political standpoint of view business are finding it hard to manage works that work at home.
Things like productivity level as well as face to face supervision has been lost
This has made a negative impact for the company as they don’t know what the most effective way is they can clearly communicate a good way to keep the works feeling like they are still part of the company so motivation to stay working stays up
Economic Factors
it is becoming slightly becomes harder for companies to manage this then costs money as they don’t have eye to eye supervision.
Less people bought shoes as they were not using then as much so the sales for Nike dropped. So, they had to make sure they made a sure that fits the market and customers will buy.
Social Factors
This can have negative impact on companies. This is because people have different motivation factors and one of them is in person work life.
This has helped money people helping with people’s social lifestyle. But with working remote thus has caused communication gaps and many people are finding it hard to stay motivated to work.
So, for a solution they can offer people options whether they want to work on in person with covid restrictions or work at off.
Technological factors
This means that Nike had to figure out to make sure everyone had some sort of internet cable, so they stay communicated.
They had made the bills as they had to make sure all the works have some sort of internet connections
Enviromental factors
They reduced the green carbon footprint as less gas emissions as less production and cars from the works was being used. This is making a positive impact for the environment and can be a selling point for Nike.
Legal factors
They can fight the changes they have faced the past years of poor working conditions as workers are working the comfort of their homes.
estimated value of USD 96.10 billion by 2026 so the competition within the market is fierce.